Aubuchon, Westlake and Do it Best look ahead
In the hardware business, sometimes it seems as if the more things change, the more they stay the same.
“My great-grandfather started our company in 1908, and I’m always amazed at all the familiar things I see in our historical photos,” said William E. Aubuchon IV, president and CEO of the Aubuchon Company.
Still, there are indeed forces at work changing the fabric of the business. And HBSDealer recently turned to three hardware industry leaders for their thoughts on where hardware stores are going.
We spoke with:
• Allison Flatjord, director of e-commerce at Do it Best;
• Joe Jeffries, president and CEO of Westlake Ace Hardware; and
• William E. Aubuchon IV, president and CEO of the Aubuchon Company
Some of the futuristic ideas include the usual suspects such as self-checkout, electronic shelf labels, and 3-D printing; but also apps and systems that turn the hardware store into a smart home improvement center, connected to the customer’s phone.
Here are some of the highlights from our experts.
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Allison Flatjord, director of e-commerce at Do it Best, believes the hardware business will operate quite differently in the year 2030.
“The industry has lagged in technology overall,” she said, “but it’s now at a stage where consumers are expecting – and demanding – adoption of conveniences and services they’re getting elsewhere, such as same day in-store pickup and remote location delivery.”
The ability to fully shop and explore the store before ever going in is the key, said the e-commerce director.
One of those changes will be in what she called, “personalization of experience, tailored to what you like; for example, what you’ve purchased before, but with a much deeper knowledge of the customer.”
Another, said Flatjord, comes in, “delivering a true omni-channel environment where there is still a need for in-person interaction.”
Flatjord has some futurecasting ideas as well.
In-store robots will arrive, she said, “maybe not common, but available for remote shopper assistance and curbside delivery; inventory management; stocking; and mixing paint.”
She thinks self-checkout will become ubiquitous. And a drive-thru omni-shopping location for all services is “coming, but likely not by 2030.”
Flatjord adds some additional possibilities, such as a store app that, “allows you to take a photo of something in your house that needs to be repaired and then an entire repair order with all the products you need is generated and delivered, with instructions on making the repair.”
She also said there could be, “3D printing of repair parts, such as hinges, keys and fasteners.”
In summation, Flatjord said there will always be a need for “in-person interaction, problem solving and product discovery.”
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Joe Jeffries, president and CEO of Westlake Ace Hardware, has his own take on the near term (the year 2030) future of the hardware business: “It will be different – yet familiar,” he said.
“We’ll still be offering helpful and personalized service, but the product offerings will change dependent on consumer tastes and general societal trends,” said the Westlake president.
Look for an increase in the depth and breadth of products for electric vehicles, cutting-edge solar and battery-powered home generators, and new battery-powered hand tools and outdoor power equipment, he said.
“As more homes will have solar-powered roofing, look for hardware stores to carry the componentry and supplies homeowners will need to maintain those systems. We’ll likely see continued growth in the solar-powered outdoor lighting segment as well,” said Jeffries.
In the lawn and garden segment, he said, “we can expect more and more consumers will continue grow their own food. They will need the products and advice to do that.”
Jeffries also anticipates that increased awareness about pesticide usage will have an impact on the types of products they carry.
More generally, he said, “The Hardware store of 2030 will be a hub for all services a customer may need for their home or business.”
He feels that because businesses like his are so focused on being helpful and building personal relationships with their customers, he doesn’t see a day when that will be replaced by robots.
“Customers come into our stores in need of advice, a friendly face, and guiding hand. You simply can’t replace that type of connection with technology,” he said.
“Technological developments will make us more efficient and, ultimately, help us better serve our customers.”
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Looking ahead to 2030, Will Aubuchon IV, CEO of Aubuchon Company expects similarities, especially in the general appearance of the typical hardware store. But big changes are brewing on a demographic level.
There has never been a larger generation than the millennial generation in modern American history, which is a reason to be bullish about hardware retailing in 2030 as millennials enter their prime earning and home ownership years. But, assuming immigration remains constant, the prospect of declining population growth looms in the distant future as a structural headwind.
The result of this headwind, said Aubuchon, will be less customer count, and the need for ever-greater average tickets in the form of new products, services, and more B2B and commercial sales.
Another trend to address is that wage growth will continue to outpace sales growth. To solve this challenge, hardware stores need to embrace productivity improvements like never before. On a relative basis, he said, the goal must be, “fewer people paid more in stores that are easier to run.”
He sees productivity initiatives playing a role, such as, “eliminating every possible second required to ring up an average POS transaction.”
Along those lines, there will be self-checkout options to maintain or increase throughput with fewer cashiers, he said, along with “either roaming robots or fixed cameras with computer vision to eliminate the need for manually identifying ‘outs’ and robots for routine floor care maintenance.”
Look for, “electronic shelf labels to eliminate manual price changes,” said Aubuchon, and an “industry-wide shift to building more resilient supply chains that can support just-in-time inventory to minimize overstock.”
The Aubuchon Company CEO predicts some trends will accelerate.
“Customers will expect more digital shopping options, such as self-pickup with no employee assistance; 24/7 self-pickup via lockers; as well as delivery by store employees and by third parties like Uber, Door Dash and others,” he said.
He also thinks that by 2030, customers will desire to use more payment options in-store and online, including digital wallets like Apple Pay, Google Pay, PayPal, Venmo, and eventually even crypto.
He can see a day where, “selling digital and in-store ‘retail media’ to vendors could become a meaningful revenue source above and beyond co-op dollars.”
Aubuchon said they will continue investing in family-sustaining wages and career opportunities while also adding new benefits like scholarships for employees and family members of employees.
He said, “we also plan to continue becoming more diverse at every level of the organization and will become more purposeful in reducing our carbon footprint.”
